When it comes to money, it’s important to be financially literate. Studies have shown many of us learn about money at home. And this way of learning does not guarantee success. In fact, many people struggle managing money as a result of the way they were taught.
The good news is that many states understand the problem and are working to get more personal finance education in schools. However, there is still a real problem out there when it comes to financial literacy. That’s why I’m committed to helping people build stronger personal financial knowledge.
Speaking of personal finance knowledge, do you think you can pass a high school financial literacy test? Answer the questions below to find out:
1. Sara works full-time at the Big Save store and earns $2,500 per month. Who pays the contributions to Social Security on the $2,500 per month in wages she earns?
A. Only Sara.
B. Only Big Save, her employer.
C. Both Sara and Big Save, her employer.
D. I don’t know.
2. Amanda has $5,000 saved up from working at different jobs. She puts her money in a savings account that pays four percent a year in interest. How much money will be in her account at the end of the first year and at the end of the second year?
A. End of first year: $5,100; end of second year: $5,400.
B. End of first year: $5,200; end of second year: $5,400.
C. End of first year: $5,200; end of second year: $5,408.
D. I don’t know.3. Marco went to the grocery store to buy a box of cereal. The type of cereal he liked came in three different brands and three different size boxes. To select the brand and the box with the lowest unit cost, he should look at the:
A. Largest cereal box on the shelf.
B. Price per ounce of cereal in each box.
C. Most popular brand of cereal.
D. I don’t know.
4. Which one of the following best describes the relationship between the interest rate charged to a person for a loan and that person’s risk of nonpayment of the loan?
A. Lower interest rates are charged on loans with a lower risk of nonpayment.
B. Higher interest rates are charged on loans with a lower risk of nonpayment.
C. Lower interest rates are charged on loan with a higher risk of nonpayment.
D. I don’t know.
5. John drove his car to the local Gas and Shop store. On the way to the store he got distracted while talking to his friend in the car and hit a street sign. Neither he nor his friend was hurt in the accident, but the front end of the car was damaged. What type of automobile insurance coverage will provide reimbursement for damages to his car?
A. liability.
B. collision.
C. comprehensive.
D. I don’t know.
How did you score? Check your responses:
1. C; 2. C; 3.B; 4.A; 5.B
